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Wednesday, February 29, 2012

Divorce does not need to be the big, long, drawn out battles that are often portrayed as being the norm. There is a way to end your marriage quietly and still keep your dignity and your money. It's called uncontested divorce. While it may not work for everyone, it is probably the best way for several reasons.

The low cost of an uncontested divorce is a great advantage. This leaves your money free to live on after the divorce or to use in raising your children. An uncontested divorce also keeps the level of conflict low and any negotiations private.

If all you're interested in doing is raking your spouse over the coals and milking him for every penny he's worth, then an uncontested divorce is probably not for you. Also in cases where domestic violence has played a role in the ending of the marriage, negotiating reasonably is usually not possible.

Once you've decided whether an uncontested divorce is the best option for you, then one of the spouses should find a lawyer. You cannot ethically have the same one, but you both do not have to have a lawyer. Typically, the one with the most needs should be represented. The one who is being represented will need to meet with his/her lawyer to discuss what the key issues involved in the divorce are and what options are available. Once the documents are prepared, they are then shared with the spouse and negotiations are made. Any changes must be agreed upon by both parties. The faster agreements are reached the quicker the divorce can take place. Once any changes have been finalized, both parties sign and each is given a copy of the paperwork. No court appearances are necessary.

For the individual who is not being represented by a lawyer, you can have a "coach" available to look over the paperwork and make sure everything is in order. They can inform you of your options and ask pertinent questions to make sure you are getting everything you need out of the divorce. This way you should not feel taken advantage of.

While uncontested divorces are the least expensive method of divorce, the cost can vary quite widely. Some lawyers charge as much as $1,200, while others as low as $90. Keep in mind that the cheaper amount you pay, the less personalized attention you will receive. Those attorneys charging minuscule amounts have a very high client load which is why they can afford to charge so little. So be prepared to wait. If large amounts of money, significant assets, or children are involved, some may charge an additional fee.

Each state has certain requirements that must be met, so get informed as to what you will need to do to get the process started.

Tuesday, February 28, 2012

One of the most important documents you should have in your estate plan is a Power of Attorney.

But do a little research on POAs and you'll discover there's more than one type: General, Durable and Springing. So which one do you need?

A General Power of Attorney is typically used when you need someone to handle legal affairs on your behalf for a short period of time. This could be because you're going out of town for example, or perhaps you want an attorney to negotiate a contract on your behalf. The General POA will grant that authority within the constraints you define.

A Durable Power of Attorney works the same way but unlike a General POA, it is not automatically revoked when you become mentally incapacitated. This type of POA is a useful tool for spouses or partners who want to ensure that someone they trust always has access to financial accounts and the ability to pay bills, talk to creditors and deal with other normal financial affairs.

The Springing Power of Attorney works just like the first two but only comes into play when you've been diagnosed as mentally incapacitated. This is often the POA of choice for people who want to ensure that their estate is protected if they become disabled. As long as you are mentally sound, the POA remains inactive, but if something should happen and you are no longer able to handle your own affairs, the Springing POA would "spring" into action.

So which one is right for you?

That of course will depend upon your individual needs. To learn more about POAs and how to use them in your estate plan, consult with a qualified estate planning attorney.

Monday, February 27, 2012

Launching a business always comes with a number of potential risks. Establishing a corporation during these unpredictable economic times can be disadvantageous. This especially is true if you are setting up one on your own or for the first time. If you are looking for an option that is less formal but is as flexible as a corporation, forming an LLC may be your best option.

LLC is an acronym for Limited Liability Company. It is a hybrid business model combining the limited liability feature of a corporation and combining it with the operational flexibility of a partnership. It is a model growing in popularity with small businesses across the country. Despite its combining of the two essential features of a corporation ad partnership, it is not one or the other - it is its own type of business unit.

Its introduction in 1977 makes this business model relatively new to the United States. In other parts of the world, it dates further back and comes with different statutes and guidelines. In the US, "partners" of an LLC are referred to as "members." Members benefit from incorporation while maintaining a small business setup. Similar to a partnership or proprietorship, members report losses and profits on their individual tax returns. Like a corporation, members have protection from personal liability - meaning, they are not responsible or accountable for any company debts.

One of the greatest things about the formation of an LLC is the fact that if the company encounters any legal trouble, only company assets are at risk. Creditors cannot go after any members and their personal assets. Many choose to form an LLC because of this reason alone.

Although each state has its own set of guidelines, the following are some general principles when forming an LLC.

- Choose a Business Name - When it comes to this regard, your company's name must be distinct from other entities in the state and needs clear labeling as an LLC. Some states also restrict the use of certain words such as bank and insurance. Be mindful of prohibited words upon setup.

- Filing of the Articles of Organization - This document is a complete overview of your business. It includes essential information such as your business name, its address, and its members. It also documents the stocks that your company may issue and legitimizes the operation of your enterprise.

- Operating Agreement - This is the written code of conduct for your LLC. It serves as a binding contract among members and needs formal adaption and amendment. Although it is not necessary in most states, the general recommendation is to draft one if you are to form an LLC.

- Licenses and Permits - Regulations vary according to industry, and even by state. Consulting with a knowledgeable document filing company will come in handy when preparing and filing the necessary documents.

Operational ease is one of the greatest advantages of an LLC. Since this is the case, you have the option to file paperwork on your own or hire a third party to do the work for you. An external group can help you save time, energy, and resources. Other than their expertise in filing documents, they may also answer all your questions during setup.

Sunday, February 26, 2012

There are certain liability issues that you need to concern yourself with as a business owner that are not present if you are working for someone else. Personal asset protection should be a major concern for you in case your company is ever involved in a lawsuit. Forming an LLC for your company is a great step towards providing this personal liability protection.

When you setup a limited liability company, you have to make sure that it is properly formed. In a court of law, your LLC has to stand up so that you are not facing personal liability from the operation of your business. Ensuring that your structure is setup properly is easy when you use an incorporation service to file the paperwork correctly on your behalf.

The more your company grows, the more contact it is going to have with customers or other parties. Each personal that deals with your business could possibly sue it, so you have to be protected against personal liability issues.

Unfortunately, as a business owner you can be the subject of a lawsuit at any given time. Protecting your personal assets from lawsuits is something you need to do as the possibility of being sued is a real one.

You need to have a business structure for your company to have the necessary personal liability protection, instead of operating as a sole proprietor. There is no reason to not have a limited liability company because of the inexpensive online formation services that are available, thus giving you the personal liability protection you need.

A company that is financial successful tends to be a larger target for a lawsuit than one that is not doing as well. So as your company finances improve, you are going to find that you are a larger target for those looking to sue a business.

You have to consider the fact that someone might be less inclined to sue a company with no money than they are going to sue a company that is worth something. As your company grows, you need to make sure that you are properly protected personally from any business lawsuits.

As a business owner, you need to make sure that you are personally protected from any liability arising from your business. Forming an LLC is a great first line of defense for personal liability protection. Completely separating your business and personal financial transactions, as well as having a properly setup limited liability company is a great way to limit your own personal liability exposure.

Saturday, February 25, 2012

There are some of you who many need to make changes in the ownership of your property. If you have owned a property in your own separate name and are now newly married and want to add your wife as part owner to the property, you would create a new Deed which would add her as a new part owner of that property. Normally a Quit Claim Deed is used to do this. In this case the title of this property would then be under your name and your wife as Community Property with Right of Survivorship. In this case if either party dies the property can pass directly to the surviving spouse without a court probate action.

A Deed is a legal document which transfers ownership or an ownership interest in a home, commercial building or parcel of land to another person, trust, living trust, partnership, limited liability company, corporation or any other legal entity which may own property under the law of that state. Real Property is always under the jurisdiction of the
state in which it is located.

This deed must describe the address of the property and have the legal description which legally describes the property printed or typed on the Deed. The party granting the deed transfer is called the "Grantor", and the party receiving the deed transfer is called the "Grantee."

This document lists all of the names of the parties that are involved in the real estate transfer. Once the deed has been signed it is recorded in the County of Record by the County Recorder and is made part of the public record, and any member of the public can view the deed transfer if they examine the public records.

There are many kinds of deeds with which real estate property is transferred. For example, a warranty deed guarantees that the "Grantor" owns the title, while the quitclaim deed only transfers the interest in the real property that a "Grantee" has. Most married couples normally hold title to real property under community property with right of survivorship. People who are not married can hold real estate ownership as Joint Tenants with right of survivorship. This means if one party dies then the other party's ownership interest will pass directly to the surviving spouse or partner.

Most deeds are recorded as a title transfer from a sale by the use of a title company which searches the public record and insures that the "Buyer" gets a clear title from the "Seller." This insurance policy assures the Lender there is a real estate loan being used to acquire the property that their loan documents will be in first or second position and that there are no deed restrictions, unpaid taxes, easements, bond assessments or other possible easements or encroachments on the property.

Friday, February 24, 2012

Few would argue that planning for your family's future beyond your own life makes good financial sense. What some don't realize is that provisions like the living trust can do more than ensure a future income. It can also help to ensure your family's emotional security and even physical well being during a difficult life period.

The first 12-24 months after the passing of a loved one are the most difficult. Families are dealing with grief and trying to adjust to life without a significant family member.

Besides the emotional pain that accompanies such an event, new financial stresses also begin to emerge. This is particularly true in cases where the loved one was a key income provider in his or her family. Between the mental stress and the financial and legal matters that must be attended to upon a death, some families find it impossible to cope with the pressure.

The living trust was created to relieve some of the financial and legal stresses that come with a family member's passing. It allows family members to forgo some of the legal issues surrounding the transfer of property. Instead, they are able to more fully concentrate on working through their grief and moving toward healing.

A living trust essentially serves as a replacement for a will. Just like a will, it allows an individual to dictate how his estate should be divided upon his death.

The major difference between it and a traditional will is that a will must be probated. A living trust doesn't need to be probated.

"Probating" refers to the process of having a deceased person's will examined by a legal court. The court is responsible for determining the validity of the will and for interpreting it. The court appoints an executor, whose job is, in part, to help oversee execution of the will.

The process of probating a will generally takes months, at the very least. One year is typical. It's not uncommon, especially in the case of a large estate, for the probating process to take years.

Not only does this delay the execution of the deceased's final wishes, the beneficiaries stand to suffer financially during the process. It may be months or years before they receive their share of the estate.

In the mean time, living and legal expenses mount. Many of these expenses cannot be deferred until the time the inheritance is received.

The living trust was designed to eliminate the probating process. It has five distinct advantages over the traditional will, including:

1) Saving legal and court expenses: It doesn't have to be probated through the court system. It can save the deceased's family thousands of dollars in legal fees.

2) Assets are distributed quickly: It takes just a few weeks to a few months to finalize and distribute the deceased's assets through a living trust. This is a significant contrast to the average of 12 months it takes when using a traditional will.

3) It maintains your family's privacy: Probate records are open to the public. Living trust asset distribution, on the other hand, is not subject to public record. Many people appreciate the veil of privacy that accompanies this instrument.

4) A home can be transferred to the living trust: The same is not the case for those using a traditional will.

5) Saving on estate taxes: A living trust can save your family thousands to tens of thousands of dollars in estate taxes, depending on the size of your estate.

A living trust is prepared in much the same way as a will. However, it need not be prepared by an attorney. Instead, it can be prepared by an expert.

It can also be prepared by the individual himself. It need only be legally registered once completed. Different states have different laws regarding this and documents that must accompany it. Be sure to check the laws in your own state.

Thursday, February 23, 2012

Who will make decisions about what you own if you become incapacitated? A Living Trust, known as a Revocable Living Trust, details how you want your estate managed, and who you want to manage it, under several different circumstances--while you are living, while you are alive but unable to handle your own affairs and after death.

A Living Trust is a legal compilation of assets, part of an estate plan, put together by a Trustmaker. That Trustmaker is you. Initially, you make all the personal and asset decisions for the beneficiary of the Living Trust. In other words, as long as you are alive and well, you are your own Trustee and beneficiary.

Choosing A Successor Trustee

If you are seriously ill or injured and become incapable of taking care of your own affairs, a Trustee of your choosing takes control of the trust to manage your assets in the way you would do it yourself, if you could. Should you die, a Trustee deals with debts, final expenses and beneficiary distribution.

With so much at stake, it's critical to appoint the right Trustee. An estate planner can help guide you, but it really comes down to your own choice. Would a bank or legal firm be better able to manage your property or would you want someone closer to you to be your Trustee? In some cases, more than one Trustee is designated.

The first consideration is to take stock of your assets and assess what complexities may surround them. The more you own or owe, the more arduous decisions can be for a designated Trustee. Making a bank or legal firm your Trustee may be the objective answer, if your estate is large or you have the possibility of family conflict.

Choosing Family or Friends

If you feel that impersonal strangers, even advisors, have no real understanding of your wishes, then hiring an outside Trustee may not be right for you. Your other option would be to assign the work of Trustee to someone you know, either a relative or a friend; however, choose cautiously.

Trustee work is usually long-term and intricate. The person chosen to represent your best financial interests, when you cannot, must be more than trustworthy, loyal and willing to do the job; they must be capable enough to act in your place and qualified enough to see your wishes through to your complete satisfaction.

Wednesday, February 22, 2012

A living trust can help beneficiaries and families avoid probate more so than a will. Find out the difference between a will and a living trust from an estate planning and probate lawyer in this free video on estate law.

Tuesday, February 21, 2012

The usual details which will be found in a sample promissory note form will be the name, address and all other contact details of the entity which is lending a certain amount of money and the entity which is borrowing a certain amount of money. The details which have been entered in the sample promissory note form will be the testimonial to the transaction or the deal which has been entered into between both the parties. This will serve as ample evidence in the event of any kind of legal action which needs to be taken at a later date.

The second column of the sample form will contain details of the amount which has been lent in the form of a loan, the time period for which the money has been provided and the amount which will have to be repaid by the debtor in the form of principal and interest. The details of the amount which has to be repaid in the form of principal and the amount which needs to be repaid in the form of interest will have to be stated separately and individually. The amount which will have to be paid by the debtor every month for the purpose of repayment should also be specified and all the advantages which can be gained by the debtor by repaying the amount before the given date should be stated clearly in the content of the promissory note form.

All the terms and conditions of the transaction which is being entered into by both the parties will have to be stated very clearly in the content of the promissory note which is being prepared. Every word in every sentence will have to be thought over very carefully so that the correct and appropriate meaning is conveyed to every person who reads this document. It is also advisable to collect samples which have been created by other companies and organizations in order to gain a proper understanding of the manner in which a promissory note form needs to be prepared.

When all the details of the transaction have been entered into the form, it will be much easier for the borrower or the debtor to remember the specific date on which the amount needed to repay the loan will be due every month. Details of any legal action which is likely to be taken in the event of any of the repayments being delayed will also be stated clearly in the promissory note.

Monday, February 20, 2012

When you would like to allow someone else to have the authority of acting on your behalf, you will have to use a legal document called a power of attorney. It is widely used legal form for any circumstance where there is a need for owner's signatures to make the contract legally binding. When a person signs the power of attorney form, he or she will be granting the legal authority to another individual to be able to stand in the owner's shoes; therefore he/she could act legally for the benefit of owner. In this situation, the person receiving the power of attorney is called attorney-in-fact. Contrary to many people's belief, the person doesn't have to be a lawyer in order to be the recipient.

In many occasions, power of attorney forms are very useful and popular among those who are especially interested in their own asset distribution or inheritance. The forms also can be used to give an authority to someone else to sign particular documents in case you are not able to be present but your signatures are required.

There are few different types of power of attorney forms, such as unlimited power of attorney, limited one and durable unlimited one. Among them there is one called durable limited power of attorney. With this form, you are providing for a limited grant of authority to another individual for very specific reasons. You are designating a person to act for you in a particular occasion, in a very specific manner and you can actually limit the activity that the person will perform. Therefore there are a lot more details described in the document and certainly there will be a limitation.

But this legal form and the contents inside will remain effective even though you become disabled or incapacitated, thus allowing the assigned person to act on your behalf in case of your losing ability. Your attorney-in-fact can keep the authority that is already given through the document and remain valid even if the power is limited. In order for this to be complete, the both parties' names and addresses should be clearly written on the document and signatures are required at the time of signing. Also there should be a full detailed descriptions and outlines of work area described on the document. Usually the owner's signature should be notarized and two other witnesses will be accompanied when the document is complete. In that case, the person who will receive the document is not eligible for being one of the witnesses.

Sunday, February 19, 2012

Using a power of attorney template is a simple method for creating legal documents that authorize an agent to take care of financial or healthcare transactions on your behalf. There are four primary kinds of POA forms that include: limited, durable, general, and medical.

Each type of power of attorney template contains specific legalese to ensure the document is legally binding. Regardless of the kind of form used, every POA includes two parties which include a Principal and Agent.

Principal refers to the individual that is creating the document. Agent refers to the person charged with carrying out transactions on the Principal's behalf. Some forms refer to agents as the Attorney-in-Fact, which essentially means the person is legally allowed to sign documents and perform tasks described in the document.

Principals can choose anyone they desire to act as their agent. While the only requirement is that agents are of legal age, it's vital to select someone that is trustworthy and dependable. The most common choices are spouses, relatives, friends, and business partners. However, agents can also be lawyers, physicians, accountants, or realtors.

Once power of attorney forms are created they have to be signed by two witnesses in front of a notary public. After witnessing signatures notaries sign the form and attach their stamp. If legal problems arise, notaries and witnesses might have to appear in court to testify.

Agents can only conduct transactions outlined in the POA. When durable or general power of attorney templates are used, agents are provided with broad powers that allow them to conduct nearly any kind of transaction the Principal would perform.

Setting up power of attorney privileges is common with estate planning methods. These forms are particularly beneficial to people that have bills to pay, or own realty, financial investments, or businesses. Arranging these documents ensures that financial matters can be taken care of in the Principal's absence.

Limited power of attorney is used when agents only need to perform a few tasks. This form is frequently used to authorize agents to pay bills using the Principal's checking account or credit cards. It's also used when a person needs to hire a mediator to negotiate with government agencies such as Social Security Disability or the Internal Revenue Service.

General and durable power of attorney grants sweeping powers that let agents take care of multiple tasks. These forms are often used by business owners to designate agents to take over business operations. They are also used by people who need someone to take care of daily activities like monitoring financial investments, handling business affairs, or selling titled property such as real estate.

Medical power of attorney is used to authorize an agent to make healthcare decisions if the Principal is declared incompetent. Agents are not allowed to make any medical decisions until the Principal's physician has filed a written declaration of incompetency.

Medical POA is also used to grant permission to caregivers to acquire emergency care for minor children. This form is required by daycare providers and nannies. Since children under 18 years of age cannot make medical decisions, this form is crucial for receiving emergency care if parents are unavailable.

The only way agents can perform transactions that necessitate legal permission is by setting the proper type of power of attorney template.

Saturday, February 18, 2012

There is one thing we all share in common: our days on this planet will come to an end - probably by surprise. That is about as basic a 'common denominator' as you can possibly get. To protect our loved ones from having to endure years of court procedures and legal fees, the Revocable Living Trust ('RLT') is a widely-used way to avoid the two related court proceedings known as Probate and Conservatorship, and to pass our assets on to one's loved ones with favorable tax planning.

WHAT IS CONSERVATORSHIP?

Conservatorship is court proceeding. It arises when someone cannot manage their financial affairs and it's time to have someone 'step in'. Maybe they've suffered a stroke or are in a coma or some other disabling condition. The court can appoint a 'Conservator' over the person or the estate or both. The conservator's job is to temporarily manage the financial affairs and property of the person they have been appointed for. This is often done by someone who's either a professional (a bank, a CPA, attorney, etc.) but sometimes it might be a family member who has the experience to warrant a court appointment. The conservator is given legal powers by the court that remain in place until the person recovers and is able to regain control over their financial affairs, or until death, whichever occurs first. Many times a person who has undergone a conservatorship proceeding may be placed in a residential treatment facility and the person who has been appointed as their conservator will manage their finances, bills, obligations, contracts, housing and other financial decisions on their behalf.

WHAT IS PROBATE COURT?

Probate is also a legal proceeding. When a person has died with no will the court supervises the estate, ordering property distributed according to the deceased person's instructions, or if there is no will, then according to local state law. An executor or personal representative is appointed by the court and he or she has the responsibility to report back to the court as matters are accomplished. Tax returns are prepared and filed. Bills are paid. Mortgages are satisfied. When the court is satisfied that all of the heirs have been identified, the bills, taxes and debts paid off, the remainder is distributed to the persons entitled under the Will. Dying without a will is dangerous. It can trigger distribution of assets that you do not control and may not have wanted.

LIVING TRUSTS AVOID THESE PROBLEMS.

With a Living Trust in place, you avoid both Probate and Conservatorship proceedings. That's because once you execute the trust and transfer ownership of your checking account, savings account, home and other property into the trust's ownership, the trust is in fact the 'owner' of the property. You of course are both the trustee (administrator) and the beneficiary during your lifetime. Under the trust, you decide who will take over as trustee afterward, and you alone decide who gets what and when. The successor trustees may be your most responsible child, a grandchild, a trusted fiend or relative or even a financial institution such as the trust department of a bank. With the Living Trust in place, you can simply bypass the need for either Probate or Conservatorship altogether.

If you are concerned about someone 'contesting' the trust, there is a way to avoid that problem. One way is to specifically disinherit someone by name so they can't later claim to a judge that you 'forgot them'. Another way is a way that I personally think is better. You leave that person a much smaller amount (say one dollar or five dollars) but no more, and you include a provision in the Living Trust that if any person contests your trust instructions, they are to be treated as if they died before you and are therefore entitled to nothing at all. This is an easy way to avoid having someone try to tie up your estate in litigation and at the same time penalize them completely if they choose to cause you any problems as to how you wanted to distribute your estate.

WHAT SHOULD THE LIVING TRUST OWN?

The Living Trust is a separate 'person' under the law and can own various kinds of property. Typically the kinds of assets that go in to a Living Trust include: your Personal Residence, Personal (not business) bank accounts, credit union accounts, certificates of deposit, brokerage or trading accounts, stock of subchapter 'S' corporations, personal furniture, tools and furnishings, and collections such as art, sculpture or other kinds of collections that may be of value. Basically, anything you want to avoid probate.

TAX PLANNING and THE LIVING TRUST.

There are some good opportunities for tax planning with the Living Trust. Using your Unified Credit, as of 2006 you are able to pass up to $2,000,000 (per person) down to your children. That's the number for single people. Married persons can each pass the same thing, so for a couple that means up to $4,000,000.

AVOIDING MISTAKES.

The most common mistake made with a Living Trust is the failure to properly 'fund' it. That means actually changing the ownership of your personal residence, personal checking accounts, etc. over to the legal name of your Trust. Some will establish a Living Trust, sign the appropriate documents (including the Power of Attorney for Health Care, the Pour-Over Will, Directive on Artificial Life Support, etc.) but never actually change legal ownership of their assets into the Trust.

Funding the trust means that you will record a new deed on your home in the county where the property is located. You'll also visit your bank or credit union and sign new signature cards as the 'trustee' of your Living Trust. If the bank or credit union needs a copy of your trust, remember that it is a private legal arrangement. So instead of allowing them to copy all the private provisions, simply provide them with a photocopy of the 'Abstract' (sometimes called the 'Certification') which sets forth the powers of the trustee and indicates who established the trust, etc.

Your Living Trust can literally save your surviving family members thousands of dollars in legal costs, probate fees, conservatorship fees, and months and months of administrative time. With a Living Trust as the owner, assets may be transferred relatively quickly and with a minimum of involvement by outsiders who might otherwise disrupt your plans for the loved ones you wish to benefit.

Friday, February 17, 2012

QDRO forms are used for the purpose of dividing retirement assets, such as a pension or 401k plan, in a divorce a proceeding. Regardless of whether you live in a community property state (for example. California) or Equitable Distribution (also known as "common law") state, such as New York, the marital portion of a retirement plan is distributable in a divorce case. State laws which define what types of property are marital, and thus subject to division in a divorce, are not preempted by ERISA. However, the ERISA preemption requires that division of retirement assets (pensions, 401k's and similar accounts) be accomplished through qualified domestic relations orders (QDRO's).

In all jurisdictions, the marital portions of pensions and other types of 401K plans are presumptively subject to division in divorce. Each year, tens of thousands of qualified domestic relations orders are approved by plans and issued by state divorce judges. If a state-specific QDRO sample is used for guidance. A valid QDRO form can be prepared quickly and easily. Upon preparation, the proposed QDRO is then submitted to the retirement plan administrator and the court, for approval.

The necessity of using a QDRO form to divide pensions, profit sharing plans, and 401k plans in divorce results from certain provisions that are contained in a federal law known as the Employment Retirement Security Act (ERISA). Until 1984, two provisions in ERISA raised questions as to whether a state court could even issue an enforceable order for the distribution of retirement benefits. These two provisions were ERISA's: (a) preemption provision, which made regulation of retirement plans a matter of exclusive federal interest; and (b) spendthrift provision, which restricted a plan participant's ability to assign his or her benefits under a pension plan covered by ERISA.

Because of concerns that ERISA's spendthrift and preemption provisions affected the validity of state court domestic relations orders (DROs), Congress enacted the Retirement Equity Act of 1984 to exempt QDRO's from those provisions. Congress provided that the spendthrift provision "shall not apply if the order is determined to be a qualified domestic relations order [QDRO]." Consistent with this language, Congress added an exception to the express ERISA preemption provision, stating that the preemption provision "shall not apply to [QDROs] " Under a QDRO, an alternative payee is treated as a plan beneficiary.

A DRO is "qualified" if it "creates or recognizes the existence of an alternate payee's right to, or assigns to an alternate payee the right to, receive all or a portion of the benefits payable with respect to a participant under a plan." The QDRO provisions define "alternate payee" to mean "any spouse, former spouse, child, or other dependent of a participant who is recognized by a domestic relations order as having a right to receive all, or a portion of, the benefits payable under a plan with respect to such participant."

Valid QDRO forms are available for download. However, it is important that divorce litigants and attorneys carefully select the type of qdro template that they use based on the type of retirement plan that is being divided.

Thursday, February 16, 2012

Over the past 30 years, as divorces have become more and more common, the traditional, highly contested divorce proceeding has gone the way of the fedora and the spittoon. Only about 5% of divorces every year go through a lengthy court battle. About 95%, meanwhile, are what is called "uncontested;" that is, the spouses come to a drafted, legal agreement beforehand detailing the conditions of the marriage, from division of communal property to who gets custody of the children. The court will look over the document to make sure that it is fair, and will most likely pass it.

So why, you may ask yourself, has this form of divorce become so popular? For several reasons, actually. Apart from the various inherent advantages that it poses over more litigious advantages, there are some societal reasons as well. Most states no longer require fault to be established before a divorce is granted, which has removed many couples' need for a vitriolic court battle. Furthermore, as divorce has become more acceptable in our society, a speedier, less dramatic procedure has become more desirable.

As mentioned earlier, there are a number of advantages that go along with an uncontested divorce, namely:

It's considerably less expensive. Because it doesn't last nearly as long as a contested divorce, and because it doesn't require two expensive divorce lawyers, uncontested divorces are just plain cheaper. While it can be very useful to hire a lawyer to act as a mediator and interpreter of the law, one lawyer can suffice for both parties. You also save a lot of money in service charges, expert witness costs, and deposition fees.

It's a lot quicker. While a contested divorce can take months or years to finalize, an uncontested divorce typically only takes a few weeks to make legal, and most of that time is actually just waiting for a court date, meaning you can move on with your life so much quicker.

It puts you in the driver's seat. An uncontested divorce means that you and your spouse are able to come to terms yourselves, and while it can be uncomfortable to split up your life with the person you're leaving, it can be a lot better than having the courts decide what happens to the children and who gets saddled with how much of the mutual debt. This way, you can reach your own decision.

Wednesday, February 15, 2012

The limited liability corporation (LLC) is the best business structure, for small businesses because it allows them to behave like a corporation when dealing with the public, but like an individual when dealing with the Internal Revenue Service (IRS). The corporate structure of the LLC provides the very important legal protection from claims against the owner's personal assets, while the tax laws allow the LLC to choose a tax classification that is suitable for the business. To choose a classification, the LLC must file form 8832 with the (IRS) within 2 and a half months after registration.

In dealing with The IRS the LLC has choices about how to be classified for tax purposes. A single member LLC can choose to be classified as a sole proprietorship or a corporation. Classification as a sole proprietorship allows the business owner to report business transactions with the individual return on schedule C, avoiding the cost of preparing a separate business return. A multi-member LLC can choose to be classified as a partnership or a corporation.

The LLC provides an added level of flexibility in that the business can change its tax classification to suit the needs of the business and the owners. For example a single member LLC may choose the classification of sole proprietorship initially, when profits are small and there is no advantage to be classified as a corporation, but change its classification to a corporation at a later date when profits are larger, and tax avoidance strategies are needed.

There are some rules members of LLCs need to be aware of. Once the LLC is registered, the business owner has two and a half months to file form 8832 to choose its tax classification. After the LLC files the initial form 8832 choosing its tax classification, it can change that classification every 5 years. If form 8832 is not filed, the IRS will determine the tax classification of the LLC. In the case of a single member LLC, it will be classified as sole proprietorship and in the case of a multi-member LLC it will be classified as a partnership.

The structure of the LLC is perfect for a small business as it provides the business with credibility and the owners with legal protection from day one, but allows the business the flexibility of changing its tax classification with the IRS therefore taking the best advantage of the tax code.

Tuesday, February 14, 2012

You and your spouse just got a divorce. The law requires that when this happens, conjugal properties need to be divided equally between the spouses. However, your partner has a real estate property he bought before you got married and in all due respect to him, you don't want to have a claim on that. This calls for a quit claim deed.

In settling your properties, you will need to execute such a deed to waive your right to claiming that particular property of your husband. This quit claim deed will legalize everything and ensure that you no longer have any interest on that piece of property. In other words, you are giving your spouse the full right to own that real estate such as a vacation house or farm.

A quit claim deed is a document required when transferring ownership of a property from one person to another. This is also used when transferring properties to family members as gifts or inheritance or when an individual wants to put his personal property into a business entity.

Sample forms are offered by certain websites catering to legal forms or real estate forms. So if you're about to create a quit claim deed, you may want to check out the internet first and find out what information will be needed in the form. Normally, you will have to provide a legal description of the property.

There are two options when creating a quit claim deed. You can do it yourself or let your lawyer do it for you. If you want to take the first step, you can download your form on the internet by paying a certain fee. There are some sites that offer standard forms. Or you can buy a blank form from a bookstore or a shop that sells office supplies.

In filling up the form, avoid making mistakes in spelling and facts as they can make your deed invalid. List the name of the owner as grantee. If you have children and your husband agreed to have them as beneficiaries, add the names of your children as grantee as well. Next step is to list the current owner of the property as grantor.

A quit claim deed needs to be notarized and make sure that make photocopies (more than one if possible) for you records. After notarization, you can bring it to the county's clerk and recorder's office where the deed will be officially recorded. You will have to pay a certain fee.

If you have a lawyer and you're not sure how to execute this quit claim deed, let your attorney do it for you to make sure that the information is correct and with no errors. Your lawyer can then notarize the document and can have it recorded at the county's clerk.

Remember that where real estate properties are concerned, there will always be legal documents involved. This is because they are valuable investments and not something you just throw away when your situation goes wrong. Written legal documents ensure that a piece of real estate property goes to its rightful owner.

Monday, February 13, 2012

Springing Power of Attorney - A legal document that is granted only if a certain event happens in the future. This used to be a very popular legal form, but now it is being replaced by the medical form and the durable form. But, because of the Uniform Power of Attorney Act which was published by the National Conference of Commissioners on Uniform State Laws. This act is trying to get all the states to enact common laws for the country and at the same time it is getting rid of springing power of attorney.

Why do States want to get rid of Springing? Not all states recognize Springing, for example, Florida just passed a new law enacted on October 1, 2011, that forbids springing. The states do not like it because of the fact the agreement does not become valid unless a future event triggers the form. The States want a uniform code that is easy for the general public to understand, they get bogged down enough just explaining the difference between the general form and the durable form.

Why Medical & Durable forms are Better If you walked into a hospital or a real estate closing trying to use springing, it may not work depending on your state. In fact, allot of the legal websites are not even selling springing forms anymore. The medical form is much like springing, medical only becomes valid, if you are not able to make medical decisions for yourself in the future because you may be incapacitated or mentally ill.

Durable Power of Attorney - Transfers power from one person to another for "all powers legal under law". Durable stays valid if you should become incapacitated or not able to make decisions for yourself. Which means that you can trust someone to handle all your affairs whether you may be out of town or not able to make a specific event.

Other Discontinuing POA Forms The other form that may be coming to an end is the general form, which is the same as durable, but the general form does not stay valid if you should become mentally ill or incapacitated. So, states right now are being fed up with people confusing general and durable. States like New York, Pennsylvania, and Florida have enacted laws stating that unless a general SPECIFICALLY reads that it does not stay valid if you become incapacitated, then the form stays valid.

Sunday, February 12, 2012

Most divorces nowadays are uncontested. It's far less expensive, time consuming, and allows both sides to end their marriage on good terms. It's also better particularly if children are involved, as they won't have to witness a year long battle in court over who gets custody. The following discuses the advantages and disadvantages of this divorce in greater depth.

Advantages

As mentioned, the uncontested divorce will save both spouses a lot of money. And for many, this is probably what's most attractive about it. Contested divorces last a lot longer, and both parties really have no choice but to hire lawyers. Over the course of six months to a year, the fees will really add up and cost a small fortune. Uncontested divorces can be completed only spending hundreds of dollars, as opposed to the thousands you will have to spend going to court. Both sides will certainly benefit from the money saved.

The benefits of an uncontested divorce are intangible as well. Contested divorces are often get ugly between both sides. Fighting it out in the courts for a year will only make the relationship between the two spouses worse. And the children will ultimately suffer that much more. An uncontested divorce however allows both sides to work together and compromise. This of course doesn't mean that there won't be tense moments, but the process is much quicker and not nearly as hostile.

You will always be connected to your spouse if you have children. So it's in the best interest of both sides to have a relationship that's on good terms.

As mentioned, an uncontested divorce will likely not be without it's rocky moments. Let's face it, a breakup is never completely smooth no matter what. But as long as both sides desire to go uncontested, then chances are good that all the terms will be agreed upon.

Going the uncontested route may not always be feasible, particularly if one spouse has been abused. But it's a realistic option in the majority of cases.

Disadvantages

What are the downsides? There aren't many to be honest, but having to work with ex-wife or husband on all the issues can be emotionally draining. You will have to agree on all the major issues, such as child custody, property division, spousal support, and so on. This is not easy. You are getting divorced for a reason, and so agreeing with one another can be challenging, especially if both sides aren't willing to give on certain issues.

So uncontested divorces do involved some work on both ends. But the advantages certainly outweigh the disadvantages.

Saturday, February 11, 2012

When someone is accused of a criminal act, they face not only the immediate consequences of their actions, but the long term consequences as well. In some states even arrest records are made public, in which case anyone who is accused of a crime, even if they are innocent, may be subject to unfair public scrutiny.

If the accusations proceed to a criminal conviction, the defendant will face sentencing which may include fines, probation and possibly jail time. Their permanent record will also be forever marred by the conviction, affecting future employment opportunities and certainly quality of life.

In some of these unfortunate situations, a defendant may be able to petition the courts for a criminal record expungement which will give them the opportunity to have their permanent record wiped clean of any mention of the conviction. If the expungement is successful, then for all intents and purposes, the conviction will be treated as though it never existed. Some states also allow a complete expungement which will erase even the public record of the arrest. Depending upon the state, certain offenses may have no chance for expungement, such as sex crimes or child abuse.

Situations in which an expungement may be honored include:

• New DNA evidence leading to a finding of innocence.
• Minor violations such as jaywalking or speeding may be expunged from a permanent record.
• Completion of a "deferred sentence" such as probation, anger management, alcohol treatment or
community service within a specific period of time.
• Acquittal at trial or an overturning of the conviction.
• Gubernatorial pardon.

Benefits of a successful criminal record expungement are that the accused is able to move forward from the criminal proceedings with peace of mind knowing that their criminal record will not be affected by the situation. For some this means that an embarrassing mark on their personal history will be erased, but for others it means the difference between the ability to gain future employment or not. Following expungement, no future employer will be able see the felony or misdemeanor on the record, nor will the defendant be required to report the charge during an employment interview.

In some states, a person convicted of a felony may lose their voting rights or their rights to bear arms. In these situations an expungement can help restore their every day rights.

Friday, February 10, 2012

Divorce is never a pleasant thing to go through, due to the variety of emotions that can be felt at this difficult time. But it can get even more unpleasant when it comes time to divide the marital assets. If you and your soon-to-be-ex-spouse can decide on who gets what, you can file for an uncontested divorce which makes the entire process much easier.

If a married couple decides to divorce, they can file for an uncontested divorce. This is when the couple decides, without court intervention, who gets what out of the assets that been gotten while the marriage was going on. This is usually easiest when there are no children involved, and almost impossible if kids are involved. Once the arrangements have been made, the divorce can go to the courts. Since all the assets have been split up, the divorce process usually moves a lot faster.

But if there is an issue over who gets what, do not get an uncontested divorce. It's very important to get the fair share of the marital assets and that is why the court system is there to help. If you do not agree entirely to the agreement made between you and your soon-to-be-ex-spouse, an uncontested divorce is not for you. It's very important to not let your soon-to-be-ex try and bully you into an uncontested divorce if it is not best for both parties.

Once you figure out if you want to go ahead with an uncontested divorce, you may want to look into the divorce laws in the state which you live. The laws vary, sometimes significantly in certain areas, from state to state. In some states, there is a waiting period that you have to be separated from your spouse before you can file for divorce. Your best bet is almost always to seek the advice of a lawyer who can make sure that you are watching for everyone that could come up and bite you from behind.

Going through a divorce is an emotionally draining thing to go through. But the sooner a divorce can be finalized, the sooner you can move on with your life. Filing for an uncontested divorce is one of the easiest and fastest ways to become divorced. But this only works if both parties agree on how to split the martial assets fairly. Make sure you know that your ex is going to do as they say they will, since you don't want a nasty surprise when you go to sign the final papers.

Thursday, February 9, 2012

The best way to explain limited liability is this - you risk what you put in. In other words, limited liability is a way to make sure that a person who is engaging in business does not risk his or her personal possessions in case the business fails. Any investor, partner, or member of the company that by law has limited liability cannot be made responsible for any unfulfilled company obligations and debts that are more than the amount that the person has invested.

Here is a simple comparison. Jack and Jill are friends. Jack is a handy guy and Jill is a great cook. To earn money from their talents, both start their own business. Jack earns his living by doing renovations. He bought his own equipment and simply advertises his services under his own name. Jack is a sole proprietor.

Jill decided to open a bakeshop. Before going into business, however, Jill has formed a small corporation (an S-Corporation), called Jill's Cakes, Inc. Jill invested her savings into Jill's Cakes, Inc. as a starting capital and then bought her baking equipment and leased her shop on behalf of her corporation. So long as things go well for Jack and Jill there are almost no differences between the two ways of doing business.

As soon as things turn sour though, the differences become apparent. One day, Jack mopped the floor right before leaving the apartment he just painted, but forgot to put up a sign. The owner walked in, slid on the wet floor and broke an ankle. He is suing Jack for medical expenses and lost wages. Jill accidentally dropped a peanut in a wrong batch of batter and caused a severe allergy attack in one of her customer. That customer is suing her for medical bills and pain and suffering.

What is at risk for Jack and Jill? Jack is risking everything he owns - his work equipment, his truck, his house, his personal belongings. So long as there is a judgment against him, Jack must sell anything he owns to pay it. Jill is risking only her business assets - her cooking equipment, her cash reserves, and anything else owned by Jill's Cakes, Inc. But her personal things, such as her car and her apartment, are safe. Her business may become bankrupt, but her life will not be destroyed.

Of course, this story describes a worst case scenario. Many businesses prosper without many troubles. But many also fail, and it is so easy for a business owner to take advantage of limited liability that everyone should do it.

Several types of business entities offer their owners the protection of limited liability. The most popular are corporation and limited liability company (LLC). Each of these entities has its own advantages and drawbacks, but both offer their owners limited liability protection.

A few things are important to remember in the context of limited liability. First, a company must be properly maintained in order to offer full liability protection that it is designed to offer. In short, if a company is only a company in name, but is run as if it is one and the same with the person running it, the courts will consider it a sham, and will not afford the owners limited liability protection.

Second, even in a limited liability business an owner may be responsible for amounts beyond his or her investment. This is the case when an owner has personally co-signed a debt agreement (such as a credit card application). This signature gives the lenders a personal guarantee of repayment of that debt and in the case of default they can go after the owner's personal assets. Other owners of the company (or investors) would not be liable if complete repayment is beyond the resources of the business, but the owner who had done the co-signing would be responsible for that amount.

Further, in some professions it is impossible to reap the benefit of limited liability. Professionals like lawyers, doctors, accountants, chiropractors, engineers, or architects are prevented by law and ethics from limiting their liability. We want these professionals to be personally responsible for their decisions so that they always make the decisions carefully.

The bottom line is, anyone doing business should consider taking advantage of a limited liability entity, if at all possible. Consider it an insurance against your worst case scenario.

Wednesday, February 8, 2012

In today's complex and competitive world there is no greater way to protect yourself and your personal assets from the threat of lawsuits than by incorporating, whether you're a small business owner with no employees, or run a serious business establishment with hundreds. Incorporating is also a simple and legal way to cut your taxes, protect your privacy, lower your audit risk, raise capital, and much more.

What is a "corporation"? Simply put, a corporation is a legal "person" created by state statute that can be used as your "shadow" for the purpose of running a business, or several businesses. This is a "person" whom you control completely, yet cannot be held accountable for its actions. Indeed, it is a powerful concept! For that reason roughly a million of corporations are formed each year, and that number is growing from year to year.

In other words, establishing a corporation can provide a simple and inexpensive foundation if you operate a business, contemplate starting a business, wish to protect your personal assets or are thinking about estate planning. It is true even if you have or plan to have a home based or part-time business!

How Can Incorporation Help Protect Assets?

We all know that in the United States the risk of a law suit is quite high, or, in other words, people love suing other people. Statistics show that an average person in the United States today goes through five lawsuits in his or her lifetime, with at least one being devastating.

Sheltering your assets from lawsuits is possible, and you must do so before a lawsuit strikes. In today's world of political and financial interests, every person is vulnerable, including yourself, and you must recognize and come to grips with that reality. Only then will you have the sense of urgency necessary to take action to protect yourself and your assets from the virtually inevitable.

REMEMBER: The law deals quite harshly with those who seek last minute transfers of assets in an attempt to defraud creditors. That means its important to realize NOW that you might run into financial problems in the future, and take appropriate action to protect your assets, while at the same time enjoying the benefits of lowered tax liability. So don't waste time and money - Incorporate or Form an LLC today!

Saturday, February 4, 2012

Wills are documents that distribute your assets and properties to your named beneficiaries once you pass on. The will is processed by the executor, usually named in the will. The executor also manages the estate while in the process of probate. The probate process is when the will is submitted to a court for administration.

Trusts are legal documents that transfer ownership of property and assets from one person to another person or group. This involves a GRANTOR - the one with the property and assets to transfer, BENEFICIARIES - the people who would receive the benefits of the property and or assets, and the TRUSTEE - the one who manages the properties and assets. The trusts are executed while the grantor is still alive, thus the name Living trust.

Let's compare the two, living trust vs will, one point at a time.

With a will, it would take months and some even takes years for it to be executed and completed. For the living trust, it takes also a long time but the beneficiaries already profit from the property and asset. In a trust, your beneficiaries can have immediate access to the property, or the cash in the trust fund.

Wills would need lawyers to draft and then handle the probate process, which would cause additional expenses for the estate. In trusts, given that it is already a legal document when it was conceived means you can avoid excess expenses.

For a will, you will have passed away before it is processed and distributed. That means you can't oversee the transfer of your property or make sure that your requirements are met by the beneficiaries. For the living trust, well, you are alive to do all those things.

For the will, your property and assets may degrade or be lost to creditors and other predators. This could leave your surviving loved ones with nothing but the will. With trusts, your assets and properties are protected.

Wills have personalized and sometimes outrageous provisions. A kind of sense of power even though you are already gone and your family cannot shake their heads at you. For trusts, having weird provisions are not advisable because you are still alive and would probably have to justify those weird provisions.

When the two are compared, the living trust seems to come out on top, but the decision is still yours. Research other living trust vs. will comparison for more insights about the two. Picking the best for you is a matter of information and planning.

Friday, February 3, 2012

What do you mean I can't find out about my husband's accident injuries? Why can't we move my mother to the nice nursing-home down the street? The Health Insurance Portability and Accountability Act or HIPAA caused two of my clients to live through these very situations.

A husband and wife were involved in a terrible automobile accident. The husband was seriously injured. His wife wanted to make certain that the needed medical attention was given to her husband. The wife could not get any medical information from her doctor. Even though she was the wife, the new HIPAA law and regulations prevents her from receiving medical information without specific written authorization!

In another case, an elderly widow lady became incapacitated. Her two children wanted to place her in a nursing home so that she would receive adequate care. Even though they had a living will and health-care power of attorney for their mother, they were required to go to court and be appointed her guardians so that they could place their mother in the health care facility.What is the HIPAA Law all about?

The HIPAA Law in a Nutshell

HIPAA took effect on April 14, 2003.

This legislation applies to virtually every physician, nurse, pharmacist, dentist, and health care provider in the nation. It impacts everyone's access to health care information.

What does this privacy act mean? The regulations stress that health care providers must limit health information to those who are intended to receive it. This means health care information cannot be released to any unauthorized person. This may mean you may not be able to receive medical records for your spouse or parent.HIPAA Violation Penalties

The penalties for health care providers are staggering. For each disclosure violation, there is a $100 fine. If the violation is knowing, there are criminal penalties of a $50,000 fine and up to one year in prison. If information is provided or obtained under false pretenses, there is $100,000 fine and up to five years in prison. If the wrongful sale, transfer or use of the information was for commercial advantage, there is a $250,000 fine and up to 10 years in prison.

How does this affect you? To ensure an easy transition, you must have the appropriate medical release language to comply with HIPAA in three of your estate planning documents.

Documents to Update

The documents which need to be updated are:

* Your Living Will and Health Care Power of Attorney* Your Living Trust* Your Durable Power of Attorney

What if I do nothing?

You may be forced to sign the doctor's or hospitals forms in a stressful emergency situation. These documents may not reflect your choices and may contain confusing legal and/or medical terminology. Or you may be unable to sign anything and may repeat one of the above scenarios.

If your documents were created before 2003 and have not been amended since, have your attorney review them for HIPAA compliant language. Are you missing some or all of these documents? Make an appointment today!